Unformatted text preview: Who Pays Taxes? 0 TAX INCIDENCE 0 The actual division of the burden of a tax between buyers and sellers in a market. LEGAL INCIDENCE o The party on which the tax is initially levied.
ECONOMIC INCIDENCE o The party which bears the burden of the tax.
The incidence of a tax does not depend on whether a tax is
collected from the buyers of a good or from the sellers.
Everyone who receives a paycheck has several different taxes
withheld from it by their employers, who forward these taxes
directly to the government. ...
View Full Document
- Spring '08